Supplement to Prospectus Dated May 3, 1999
Supplement dated October 18, 1999
This Supplement should be retained with the current Prospectus for your variable
annuity contract issued by American Skandia Life Assurance Corporation
("American Skandia"). If you do not have a current prospectus, please contact
American Skandia at 1-800-SKANDIA.
The underlying Portfolios shown in bold below are being offered as new
Sub-accounts under your Annuity as of October 18, 1999. In addition, the
Underlying Mutual Fund Portfolio Annual Expenses for each Portfolio of American
Skandia Trust have been restated to reflect a deemed 12b-1 fee, as discussed in
Note 1 below.
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<CAPTION>
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Underlying Mutual Fund Portfolio Annual Expenses
(as a percentage of the average net assets of the underlying Portfolios)
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Management Other Estimated Total Annual Fee Net
Fees Expenses Distribution Portfolio Waivers and Annual
UNDERLYING PORTFOLIO and Service Operating Expense Fund
(12b-1) Expenses Reimbursement Operating
Fees(1) Expenses
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<S> <C> <C> <C> <C> <C> <C>
AST T. Rowe Price International Equity 1.00% 0.25% 0% 1.25% N/A 1.25%
AST Janus Overseas Growth 1.00% 0.27% 0% 1.27% N/A 1.27%
AST Janus Small-Cap Growth 0.90% 0.22% 0.05% 1.17% N/A 1.17%
AST Lord Abbett Small Cap Value 0.95% 0.36% 0% 1.31% N/A 1.31%
AST T. Rowe Price Small Company Value 0.90% 0.21% 0% 1.11% N/A 1.11%
AST Neuberger Berman Mid-Cap Growth(2) 0.90% 0.17% 0.08% 1.15% N/A 1.15%
AST Neuberger Berman Mid-Cap Value(3) 0.90% 0.15% 0.19% 1.24% N/A 1.24%
AST Marsico Capital Growth 0.90% 0.21% 0.06% 1.17% N/A 1.17%
AST JanCap Growth 0.90% 0.14% 0.01% 1.05% 0.02% 1.03%
AST MFS Growth(4) 0.90% 0.24% 0.06% 1.20% N/A 1.20%
AST Cohen & Steers Realty 1.00% 0.30% 0.07% 1.37% N/A 1.37%
AST American Century Income & Growth 0.75% 0.25% 0.05% 1.05% N/A 1.05%
AST INVESCO Equity Income 0.75% 0.18% 0.04% 0.97% N/A 0.97%
AST PIMCO Total Return Bond 0.65% 0.18% 0% 0.83% N/A 0.83%
AST PIMCO Limited Maturity Bond 0.65% 0.21% 0% 0.86% N/A 0.86%
INVESCO VIF Technology 0.75% 5.85% N/A 6.60% 5.20% 1.40%
INVESCO VIF Health Sciences 0.75% 3.57% N/A 4.32% 3.05% 1.27%
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1 Pursuant to a vote of the shareholders of American Skandia Trust (the
"Trust"), the Trust has adopted a Distribution Plan (the "Distribution
Plan") under Rule 12b-1 of the Investment Company Act of 1940 to permit an
affiliate of the Trust's Investment Manager to receive brokerage
commissions in connection with purchases and sales of securities held by
Portfolios of the Trust, and to use these commissions to promote the sale
of shares of such Portfolios. While the brokerage commission rates and
amounts paid by the various Portfolios are not expected to increase as a
result of the Distribution Plan, the staff of the Securities and Exchange
Commission takes the position that commission amounts received under the
Distribution Plan should be reflected in the expenses of the Funds. Total
returns for the Portfolios are not expected to be adversely affected by the
deemed increase in fees. The Distribution Fee estimates are derived from
data regarding each Portfolio's brokerage transactions, and the proportions
of such transactions directed to selling dealers, for the period ended June
30, 1999. However, it is not possible to determine with accuracy actual
amounts that will be received under the Distribution Plan. Such amounts
will vary based upon the level of a Portfolio's brokerage activity, the
proportion of such activity directed under the Distribution Plan, and other
factors.
2 Prior to May 1, 1998, the Investment Manager had engaged Berger Associates,
Inc. as Sub-advisor for the Portfolio (formerly, the Berger Capital Growth
portfolio), for a total Investment Management fee payable at the annual
rate of 0.75% of the average daily nets assets of the Portfolio. As of May
1, 1998, the Investment Manager engaged Neuberger Berman Management
Incorporated as Sub-advisor for the Portfolio, for a total Investment
Management fee payable at the annual rate of 0.90% of the average daily net
assets of the Portfolio. The Management Fee in the above chart reflects the
current Investment Management fee payable to the Investment Manager.
3 Prior to May 1, 1998, the Investment Manager had engaged Federated
Investment Counseling as Sub-advisor for the Portfolio (formerly, the
Federated Utility Income portfolio), for a total Investment Management fee
payable at the annual rate of 0.75% of the first $50 million of the average
daily net assets of the Portfolio, plus .60% of the Portfolio's average
daily net assets in excess of $50 million. As of May 1, 1998, the
Investment Manager engaged Neuberger Berman Management Incorporated as
Sub-advisor for the Portfolio, for a total Investment Management fee
payable at the annual rate of 0.90% of the average daily net assets of the
Portfolio. The Management Fee in the above chart reflects the current
Investment Management fee payable to the Investment Manager.
4 This portfolio commenced operations on October 18, 1999. "Other Expenses"
are based on estimated amounts for the fiscal year ending December 31,
1999.
<PAGE>
EXPENSE EXAMPLES
The Expense Examples shown below are being added with respect to the new
Portfolios that are being offered as Sub-accounts under your Annuity as of
October 18, 1999. The Expense Examples for the American Skandia Trust Portfolios
shown below reflect the deemed 12b-1 fees (see Note 1 above).
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Expense Examples
(amounts shown are rounded to the nearest dollar)
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There is no Contingent Deferred Sales Charge on withdrawals. Therefore, whether
or not you surrender your Annuity at the end of the applicable time period or
begin taking annuity payments at such time, you would pay the following expenses
on a $1,000 investment, assuming 5% annual return on assets:
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Sub-Account: 1 Year 3 Years 5 Years 10 Years
---------- ----------- ----------
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<S> <C> <C> <C> <C>
AST Marsico Capital Growth 27 83 141 298
AST Janus Overseas Growth 28 86 146 308
AST American Century Income & Growth 26 79 135 286
AST Lord Abbett Small Cap Value 28 87 148 311
AST Cohen & Steers Realty 29 89 151 318
AST MFS Growth 27 83 142 300
INVESCO VIF Technology 29 89 152 320
INVESCO VIF Health Sciences 28 86 146 308
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</TABLE>
The following underlying Portfolios are being added to the section entitled
"What are the Investment Objective and Policies of the Portfolios?":
INVESTMENT OPTIONS
WHAT ARE THE INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS?
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<CAPTION>
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PORTFOLIO
STYLE/ INVESTMENT OBJECTIVES/POLICIES ADVISOR/
TYPE SUB-ADVISOR
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<S> <C> <C>
AST Cohen & Steers Realty: seeks to maximize total return
through investment in real estate securities. The Portfolio
pursues its investment objective by seeking, with
approximately equal emphasis, capital growth and current Cohen & Steers
REAL income. Under normal circumstances, the Portfolio will Capital Management,
ESTATE invest substantially all of its assets in the equity Inc.
(REIT) securities of real estate companies, i.e., a company that
derives at least 50% of its revenues from the ownership,
construction, financing, management or sale of real estate
or that has at least 50% of its assets in real estate. Real
estate companies may include real estate investment trusts
or REITs.
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AST American Century Income & Growth: seeks capital growth
with current income as a secondary objective. The Portfolio
invests primarily in common stocks that offer potential for
GROWTH capital growth, and may, consistent with its investment American Century
& objectives, invest in stocks that offer potential for Investment
INCOME current income. The Sub-adviser utilizes a quantitative Management, Inc.
management technique with a goal of building an equity
portfolio that provides better returns than the S&P 500
Index without taking on significant additional risk and
while attempting to create a dividend yield that will be
greater than the S&P 500 Index.
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<PAGE>
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PORTFOLIO
STYLE/ INVESTMENT OBJECTIVES/POLICIES ADVISOR/
TYPE SUB-ADVISOR
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AST MFS Growth: seeks long-term capital growth and future
income. Under normal market conditions, the Portfolio
invests at least 80% of its total assets in common stocks
and related securities, such as preferred stocks, Massachusetts
convertible securities and depositary receipts, of Financial Services
companies that the Sub-advisor believes offer better than Company
average prospects for long-term growth. The Sub-advisor
seeks to purchase securities of companies that it considers
well-run and poised for growth. The Portfolio may invest up
to 30% of its net assets in foreign securities.
GROWTH
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AST Marsico Capital Growth: seeks capital growth. Income
realization is not an investment objective and any income
realized on the Portfolio's investments, therefore, will be
incidental to the Portfolio's objective. The Portfolio will Marsico Capital
pursue its objective by investing primarily in common Management, LLC
stocks of larger, more established companies. In selecting
investments for the Portfolio, the Sub-advisor uses an
approach that combines "top down" economic analysis with
"bottom up" stock selection. The "top down" approach
identifies sectors, industries and companies that should
benefit from the trends the Sub-advisor has observed. The
Sub-advisor then looks for individual companies with
earnings growth potential that may not be recognized by the
market at large. This is called "bottom up" stock
selection.
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AST Lord Abbett Small Cap Value: seeks long-term capital
growth. The Portfolio will seek its objective through
investments primarily in equity securities that are
believed to be undervalued in the marketplace. The Lord, Abbett & Co.
SMALL Portfolio primarily seeks companies that are small-sized,
CAPITALIZATION based on the value of their outstanding stock.
Specifically, under normal circumstances, at least 65% of
the Portfolio's total assets will be invested in common
stocks issued by smaller, less well-known companies (with
market capitalizations of less than $1 billion) selected on
the basis of fundamental investment analysis. The small
capitalization companies in which the Portfolio primarily
invests may offer significant appreciation potential.
However, smaller companies may carry more risk than larger
companies.
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AST Janus Overseas Growth: seeks long-term growth of
capital. The Portfolio pursues its objective primarily
INTERNATIONAL through investments in common stocks of issuers from at
EQUITY least five different countries, excluding the United Janus Capital
States. Securities are generally selected without regard to Corporation
any defined allocation among countries, geographic regions
or industry sectors, or other similar selection procedure.
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Sector funds generally diversify their investments across particular economic
sectors. However, because those investments are limited to a comparatively
narrow segment of the economy, sector funds are generally not as diversified as
most mutual funds. Sector funds tend to be more volatile than other types of
funds. The value of fund shares may go up and down more rapidly than other
funds. Each sector of the economy may also have different regulatory or other
risk factors that can cause greater fluctuations in the share price. Please read
the prospectus for the underlying sector fund for further details about the
risks of the particular sector of the economy.
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INVESCO VIF Technology: seeks capital appreciation. The
Portfolio normally invests at least 80% of its total assets
in the equity securities of companies engaged in
technology-related industries. These include, but are not INVESCO Funds
limited to, communications, computers, video, electronics, Group, Inc.
oceanography, office and factory automation, and robotics.
A core portion of the Portfolio's holdings are invested in
market-leading technology companies which the Investment
Advisor believes will maintain or improve their market
share regardless of overall conditions.
SECTOR
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INVESCO VIF Health Sciences: seeks capital appreciation.
The Portfolio invests at least 80% of its assets in the
equity securities of companies that develop, produce or
distribute products or services related to health care. INVESCO Funds
These industries include, but are not limited to, medical Group, Inc.
equipment or supplies, pharmaceuticals, health care
facilities, and applied research and development of new
products or services. The Investment Advisor attempts to
blend well-established healthcare firms with
faster-growing, more dynamic health care companies, which
have new products or are increasing their market share of
existing products.
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The following information is being added to the section entitled "Appendix B -
Condensed Financial Information About Separate Account B":
Year Ended December 31,
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1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
AST Janus Overseas
Growth
(1997)
Unit Price $13.41 11.70 - - - - - - - -
Number of Units 43,711,763 21,405,891 - - - - - - - -
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AST Lord Abbett Small
Cap Value
(1998)
Unit Price $9.85 - - - - - - - - -
Number of Units 4,081,870 - - - - - - - - -
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AST Marsico Capital
Growth
(1997)
Unit Price $14.00 10.03 - - - - - - - -
Number of Units 40,757,449 714,309 - - - - - - - -
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AST Cohen & Steers
Realty
(1998)
Unit Price $8.28 - - - - - - - - -
Number of Units 3,771,461 - - - - - - - - -
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AST American Century
Income & Growth
(1997)
Unit Price $13.35 12.06 - - - - - - - -
Number of Units 13,845,190 9,523,815 - - - - - - - -
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</TABLE>
WFVASL-SUPP. (10/18/99)
